Roadmap to Rationing
At the GOP caucus meeting last week, President Obama got into an exchange with Rep. Paul Ryan (R-WI) over Ryan’s alternative budget proposal, the Roadmap for America’s Future Act. That proposal, according to its CBO score (pdf), would begin to generate budget surpluses sometime after 2060 and would erase the entire national debt by 2080. The crux of the plan is a fundamental transformation of Medicare, from the entitlement program it is today into a voucher program that would assist seniors in purchasing private insurance. The projected savings would be generated by holding the rate of growth in health spending below the growth in health costs through constraints placed on the value of the vouchers.
Matthew Yglesias captures the significance of the proposal:
Ryan’s plan comes close to clarifying what it is that’s so expensive about the policy status quo—not waste, not inefficiency, not bureaucrats, not illegal immigrants, but the government’s commitment to providing health care to senior citizens. The core element of Ryan’s plan for Medicare isn’t that it involves means-testing or other cuts around the edges, it’s that it just abandons that commitment. Right now if you’re old, and you get sick, and there’s some treatment that will uncontroversially cure you, then doctors come and cure your illness no matter your income. The Ryanverse won’t look like that. Ryan’s vouchers will buy some kind of health insurance for all seniors, but over time that insurance will start looking pretty skimpy relative to prevailing standards of care. Lots of seniors will die preventable deaths due to lack of funds.
As the President pointed out, the Democrats’ health plan only slightly pares down Medicare expenditures (primarily by trimming back Medicare Advantage payments) but has been accused of slashing seniors’ benefits and essentially throwing granny under the bus—in a word, rationing. Rep. Ryan, in an interview with Ezra Klein, admits the necessity of rationing: “Rationing happens today! The question is who will do it? The government? Or you, your doctor and your family?”
But under Ryan’s Roadmap, “you, your doctor and your family” would be no more empowered to decide whether you will receive the care you need than you would under a regime of full-fledged death panels—unless, that is, you have personal wealth sufficient to upgrade from the tinpot insurance you could afford with your McMedicare voucher.
The question should be: do we accept an obligation to collectively bear the risk of financial loss resulting from the provision of medical care to seniors? And if we do, by what principle will limited healthcare resources be distributed? By the wealth of the patient, or by the cost-effectiveness of the treatment?
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